Even free money can’t convince Australian energy companies to build new coal plants

Australia is in the middle of another extreme summer. Many regions are experiencing temperatures 10 °C (18 °F) higher than average. The demand for electricity to run air conditioners has caused major blackouts. The obvious question for its politicians: What can we do about energy security?

The answer, according to prime minister Malcolm Turnbull, is to subsidize the construction of new coal power plants. He claims the solution is a win-win. Subsidies will not just provide energy security, but also create jobs. Plus, Australia has a lot of coal, and mining it is dirt cheap. What’s more, Turnbull wants the industry to use “clean coal” technology to reduce emissions.

Unfortunately, several energy companies themselves are not interested (paywall) in Turnbull’s offer of free money.

Climate scientists have warned that Australian summers are likely to get worse as global warming’s effects become more severe. Construction of a new coal power plant can take up to 10 years, and some energy companies are rightly worried that a change in government would lead to a tax on carbon-dioxide emissions and render their operations economically unfeasible.

While newer-generation coal power plants produce fewer emissions, the levels of carbon dioxide released are still twice the amount generated by natural gas to produce the same amount of electricity. What’s more is that, according to Bloomberg New Energy Finance, once new construction costs are included, coal power costs twice as much as wind, solar, or gas power.